Israel has confirmed that human remains handed over by Lebanese militant group Hezbollah as part of a prisoner swap are those of two of its soldiers.
The Israelis handed over five Lebanese prisoners, including a man convicted of killing a child, and the bodies of 200 Lebanese and Palestinian fighters.
Their capture sparked a month-long war between Israel and Hezbollah.
Hezbollah leader Hassan Nasrallah personally welcomed the five released militants in Lebanon's capital, Beirut.
"The age of defeats is gone and the age of victories is upon us," he said.
Hezbollah shows the coffins containing the bodies of the Israeli soldiers
The Israeli soldiers, Eldad Regev and Ehud Goldwasser, were seized in 2006 but until now there had been no confirmation of their deaths.
The two Israeli soldiers are due to be given military funerals on Thursday.
Israeli generals informed their families of their deaths personally, following their identification by Israeli forensic experts.
Earlier, relatives broke into tears on seeing TV images of Hezbollah handing over the two coffins.
The Lebanese prisoners crossed into Lebanon after being taken to Israel's Rosh Hanikra border crossing, the exchange mediated by the International Committee of the Red Cross.
Changing into combat fatigues, they were given a jubilant reception in the coastal town of Naqoura before being flown to the capital, Beirut, where Lebanese President Michel Suleiman and other officials greeted them.
Lorries were conveying the remains of the dead fighters, who include both Lebanese and Palestinians.
Red carpet
Lebanon has declared a national holiday to mark the swap, after which Israel will hold no more Hezbollah militants.
The BBC's Crispin Thorold in Beirut says the exchange is a moment of jubilation for Hezbollah, who are claiming the deal as a victory.
PRISONER EXCHANGE
From Hezbollah: Bodies of Ehud Goldwasser and Eldad Regev, and remains of other Israeli soldiers killed in Lebanon in 2006
From Israel: Five Lebanese prisoners, including Samir Qantar, and remains of some 200 Lebanese and Palestinian fighters
The Lebanese president welcomed the five ex-prisoners to Beirut as "resistance fighters coming back from the prisons of the occupier".
Hassan Nasrallah's public appearance was his first since September 2006.
He was cheered by thousands of flag-waving supporters and pledged to give a longer address via videolink shortly.
Earlier, hundreds of spectators in southern Lebanon cheered as the men were given a hero's welcome by Hezbollah leaders.
Martial music blared as the five walked down a red carpet in Naqoura.
Under the deal - the fruit of two years of delicate German mediation - Hezbollah is also to return the remains of Israeli soldiers killed in south Lebanon in 2006.
The agreement has caused controversy in Israel, with some ministers opposed to exchanging live Hezbollah prisoners for dead bodies.
But Israel says it has a moral obligation to bring its soldiers home.
Israel's cabinet gave its final approval for the prisoner exchange on Tuesday.
Qantar controversy
The five Lebanese prisoners freed include Samir Qantar, in jail since 1979 for a deadly guerrilla raid in which he killed three Israelis, including a child.
The killings were particularly brutal, making his release controversial in Israel.
Qantar was serving several life sentences for murder for attacking a civilian apartment block in the Israeli coastal town Nahariya in 1979 along with three other gunmen who landed by dinghy from Lebanon.
A policeman, and a father and his four-year-old daughter, were killed. A baby girl was accidentally smothered by her mother as she hid in a cupboard during the attack.
Qantar has said he does not remember killing the four-year-old, who was battered to death with a rifle butt after her father was shot.
Two of the other gunmen with Qantar were killed. A third was jailed but later freed in a prisoner swap in 1985.
Qantar's imprisonment was arguably a catalyst for the 2006 war between Hezbollah and Israel, our correspondent says, as Lebanese militants captured the two Israeli soldiers to demand his release.
Ehud Goldwasser's father, Shlomo Goldwasser, said he was mystified by the Lebanese celebrations, coming after the recent war with Israel.
"I cannot understand what the Lebanese are so glad about and happy about," he said.
"They sacrificed over 700 of their best warriors and all their economy, and what they get for what they did is a murderer, a bloody murderer of a three-and-a-half-year-old girl and her father - and for this they are making all this glory, for this they sacrificed so much. So I feel only pity for them."
Hezbollah withheld any information about when the soldiers had died and never released pictures of them in captivity, leaving it unclear whether they had been killed in the original raid.
However, one Hezbollah official quoted by Lebanese TV on Wednesday confirmed that both soldiers had been seriously injured during the raid, and later died of their injuries.
This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.
Bookmark with:
What are these?